As seen on The Grommet: Building a retail experience for the online era

If the success of hardware companies launching their wares on Kickstarter and Indiegogo has taught us anything, it’s that people are willing to shell out substantial sums for products that have a compelling story and need attached to them.

In an era where we can buy highly specific products at the click of a button thanks to Amazon, or receive a surprise every month via a retail subscription such as Birchbox or RXVintage, people are still searching for more ways to shop. Jules Pieri thinks they are searching for both a unique product and a story, and five years ago she built The Grommet, a site that would cater to that need.

QVC meets Kickstarter

In 2012 Grommet raised an undisclosed amount of funding, a sign of vindication and the end of lean times for Pieri. This summer the site, having grown to 45 employees from 12 the year before, moved into new office space — adding 6,300 square feet in Somerville, Mass. This growth is both a sign of the value The Grommet provides its audience as well as a doubling down on new types of commerce in an online era where DIY and makers coexist with Walmart Labs and Amazon’s warehouses.

I met Pieri in 2010 at South by Southwest and was struck by her vision and her site. She saw how the internet could change retail, making it a venue for building trust and a market for new products. While I don’t visit daily, it does bring a unique mix of products to my attention, some of which I have ordered. It’s like QVC meets Kickstarter.

The Grommet founders Joanne Domeniconi and Jules Pieri.

“Fundamentally it made me really angry that the best products and companies were not really winning. They should but the dynamics of the consumer market tend to favor the larger guys, but the faster, bigger innovations tend to happen with the smaller companies, because they have fewer obstacles to that,” Pieri said, explaining why she started the company. “So I had a lot of excitement around new products and there’s nothing bigger than launching products for consumers in terms of making a big impact.”

Products such as the Lumoback posture corrector or the new lawn game Rollors are launched every 24 hours with videos, pictures and stories about the product’s creation or use. The Grommet also hosts interviews with the creators of the products, giving them a platform to interact with the 100,000 daily visitors to the site. Increasingly The Grommet is designing partnerships to share its products on other sites as well. On Wednesday it announced a partnership with Boston.com.

And Grommet buyers aren’t necessarily the tech heavy crowd you might think. Pieri said the median income of the women — who comprise most of the site’s buyers — is $100,000 and they are shopping with a practical need in mind. These are not people willing to fund a $200 light bulb or a prospective smart watch that will be delivered in six months. This is your mom or your wife who has established a trust with the site and knows that if something is featured there, it’s something they can buy with confidence.

Giving mass market a helping hand

That’s the consumer side of the equation, but The Grommet, which was founded by Pieri and Joanne Domeniconi, also helps the manufacturers of innovative or smaller products find an audience — and perhaps graduate to mass market retail. Perhaps one of the most compelling examples of this happening was a product that launched in 2010 — the SodaStream.

The more than 100-year-old business appeared on The Grommet, with a story about how the product helped reduce plastic and aluminum associated with canned and bottled sodas. It’s now sold in major chains and was recently incorporated in a Samsung refrigerator. Would that success have happened without The Grommet? Perhaps, but it does highlight a missing link on the retail side of the equation.

The Lumoback posture corrector.

Between mass market retailers online and off, and the smaller stores or places like Kickstarter, there is a gulf. Buyers working for Target or WalMart, for example, can’t afford to take a risk on (or offer shelf space to) an unknown and untested product, but they also know that their shoppers want to do more than just tick off a list of goods when they make their weekly or monthly trip.

Enter The Grommet. The Grommet team consists of four buyers, which The Grommet calls “launch managers,” who vet potential products for things such as manufacturability, quality and reliability. They then help those products find an audience. In many ways Grommet is building a higher quality and less cheesy version of the infomercial and using the web to do it at a larger scale without crazy high studio or distribution costs.

One can search for products based on the recipient, by category and even based on your personal values. For example, there’s a section for natural products but also for products made by “underrepresented entrepreneurs,” which are created by female founders, founders under age 25, or over age 65. But before you feel like this is all just a feel-good endeavor, know that The Grommet is expected to grow sales 450 percent from 2012 to 2013. It gets most of its money as retailers do, by buying goods wholesale and marking them up to the retail price. But it’s hoping to increasingly add a revenue stream by signing partnership deals with sites and retailers that will bring the products it has vetted to larger audiences.

The Grommet’s new offices in the Boston area. The company moved in June.

Growing a business on a shoestring

This growth in business focus comes with growth in the company. The new offices and almost fourfold growth in employees is thanks to an undisclosed round of the funding scored last year. It was led by Japanese online retailer Rakuten. Before that Pieri was scraping by with a small staff and cramped space. The company had raised $4.4 million from angels but never in large enough amounts that Pieri felt she could stop fundraising and focus in on the business.

Pieri is now focused on the next stage of building The Grommet and hopes to see the site achieve success as an in-between stop for innovative products trying to move from crowdfunding or one-off markets such as Etsy into the mass market. Or perhaps they are trying to expand market share from overseas. For consumers, The Grommet could become the internet version of your favorite boutique. You know, the one with all the cool unique stuff that makes it a great place to pick up a gift for you or someone else.

For retailers, The Grommet is a trusted source of product launches that have been vetted by The Grommet’s buyers and might help liven up their shelves or web sites. And for companies with a product to sell, The Grommet is the media platform that puts them in touch with consumers and with potential distributors. This a new niche in retail, but one that so far everyone’s buying into.